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Starting a HVAC/R firm
8

Starting a HVAC/R firm

Starting a HVAC/R firm

(OP)
I want to start my own HVAC/R consulting firm.  While I plan on moonlighting at first, I want to position the firm for quick growth to about 10 engineers/designers.  My idea is not to compete with the existing firms, but become a subcontractor. My partner and I are both PEs with about 12 years experience between us.  My question is directed to the HVAC/R consulting firm community: What specific products/services are existing firms looking for?

RE: Starting a HVAC/R firm

pklein

I by no means have any broad experience in the HVAC/R industry. I am a controls engineer and have been involved in a very large plant startup for over a year. The Air Handlers and Refrigeration systems have been an controls problem from day one. The plant wants all of the equipment tied into the SCADA system, and both firms involved failed to so for lack of experienced controls and commissioning personnel.  

Our company was since awarded a contract to go over their equipment and tie it into the plantwide network.

Just some food for thought..

Madkungfu

RE: Starting a HVAC/R firm

I agree with Madkungfu.

Many HVAC/R firm lack of a good SCADA personnel or only know certain programs which are not compatible with a particular plant standard.

RE: Starting a HVAC/R firm

5
I got my PE in '95 and started moonlighting a couple years later. Three years ago my employer decided this was not allowed. At that time I was getting 1/3 to 1/2 of my income from moonlight work, so I quit them and went solo full-time. I'm now earning triple what I made then, and still  working the same 60 hour week.

I highly recommend the moonlight strategy if you can get away with it. Starting up is hard enough from a sales and service delivery standpoint. Throwing in all the tax, insurance, and other business issues reduces your odds of success. It's best to tackle those AFTER you have a satisfied customer base in place. And there's no safer way to build that base than under the security of someone else's payroll.

Start with cold calls to a few local architects and HVAC contractors who do small design/build projects. Spend way too much time on your first few projects and get them perfect. Then charge slightly less than market rates. The trick is get your systems and CAD standards in place so that projects later on go seemlessly and fast. That's how you build a reputation and make money.

Be very certain that you don't short-change your current employer by moonlighting. Maintain definite boundaries between the two worlds, and err on the side of over-serving the folks paying your salary. I actully found that my day-job performance went up as a result of moonlighting. I learned to be more self-reliant and time-conscious. It turns out that while I was learning to how to make more money for myself by being more focused and effective, I was also making more money for them. They really should have made me a partner instead of a competitor. Oh well, it's their loss.

Regarding competitor vs. subcontractor, do both. Most folks aren't as concerned about the details of the business relationship between two organizations as they are with getting the work done better, faster, and cheaper; and these are the only features that matter. Every pitch you make to a client will boil down to at least one of them.

Specific service needs that seem to have arisen recently include:
Design/Build Documents - used to solicit bids from D/B contractors for Mech/Elec/Plumb (MEP) projects. Can also be used for permitting. Architects use this strategy to keep their fees low in highly competitive situations by not doing detailed designs for these systems.
Permit Documents - contractors usually don't have PEs on staff and need a stamped dwg to get through plan review. They want fast and cheap, but you can leave much of the non-critical details up to them.
Full Plan & Spec preparation for large MEP projects will likely be a few years away. This is the preferred arena of the large firms you will ultimately compete against due to the large fees involved. It is also the highest risk work you can do, so don't go there without insurance and impeccable work-product. Architects will be reluctant to team-up with you on these until you have a reputation established.

One final note on marketing. It's sort of silly, but after I was in business for a year, I sent a holiday card with my business card attached to every architect and contractor in my area. It cost me about $1 each, less than $500 total, and I got over a dozen new clients from it. Cheapest advertising I've ever seen. Good Luck.

RE: Starting a HVAC/R firm

Pklein

I notice that you are planning to start your own business.  I am currently working on starting my as well.  I am also a P.E. with over 10 years of experience in the field.   I have worked throughout our industry.  I have worked for an Engineering Firm for approximately five years, I worked for a pump manufacturing representative for two years, a manufacturing representative in the humidification/dehumidification market for one year and I have worked for a Mechanical Contractor for over two years.  These career changes have been enlightening for me.  I feel that many mechanical engineers do not have this type of exposure in this field.

My current goals are to start networking with old clients and also to contact architects in my area.  I think I can convince them that my knowledge will help them to produce better construction documents versus the big boy in my area.  I think you should also take this approach.  Prove to the architect, since you are a small company, you will strive to satisfy their needs.  Remember, Your first goal is to satisfy your client, and your last goal is to satisfy you.  Because if you do not satisfy your client, they won’t be back (I know this feeling very well).  

I am glad to talk to you.  I look forward with more conversation.

Thanks

RE: Starting a HVAC/R firm

I am looking to start a hvac/referation service-installation company. I have the unlimited lic. in michigan what would be the best way to aproch this?

RE: Starting a HVAC/R firm

Here's a possible market niche for all y'all.  Good luck with it.

I've been exposed to the fiberglass boat industry for about a year now.  Spraying polyester resin (to make the FRP) releases styrene which must be ventilated.  Common method is to simply move air in the spray booth (meets NFPA standards) and blow it into the atmosphere.  States require VOC permits for the pollution, some more stringent than others.  Boat companies (my market research for another engineering niche shows at least 250) are generally low-tech organizations who just want to make boats and not be bothered with engineering.  Those companies have the potential of making piles of money since boats seem to be as addictive as crack cocaine.  They need someone to design and install air handlers, ducting, yadda yadda yadda.  So far in a year I've spent close to $0.5M with a single company doing this type of work, and it appears to be simple simple simple.  There don't appear to be too many vendors for this niche.  The toughest part (according to my vendor) is getting the time to meet all of the customer demands and the logistics of sending a crew out for the installation across several states.

TygerDawg

RE: Starting a HVAC/R firm

pklein,

Do you have experience in the HVAC/MEP field?  I tried to do what you are suggesting after getting my PE (and had a background in machine design).  I found it to be somewhat difficult to get my foot in the door, not that it cannot be done though.  I would expect your best luck in getting projects would come from architects and contractors.  Unfortunately neither of these groups will offer much training.  I am a little confused as to who you plan to subcontract from.  If it other MEP firms I see that as a conflict of interest.  They would not want to subcontract out the work to you as they would see a licensed engineer as a threat and would not be interested in training their potential competition (even if your motivation was to not compete with them).  If you are truly interested most architects I talked with wanted some sort proof of E and O insurance (errors and omissions).  Other than that, MEPDQ had some good advice in getting a set of cad standards developed.  Is your partner a EE?  Most architects I know are looking to get Mech, Elec, plumbing, & fire prot all from one place.  Not that it is required but that is one definite advantage.

RE: Starting a HVAC/R firm

Working in several countries, all far from US, I got to some recent patterns:

1- Commissionning: this seems to be area that will continiously grow. I have so strong feeling for that that I started with preparation of workable technical archive to have it available for job assignment alternative in future - some backup for overcoming sometimes unpredictable demand for engineer's services. In working as MEP Engineer in several recent projects, commissionning was so demanding and time-consuming that Clients were approving specialist subcontractors without too much complaints - even for small administrative buildings. Demand is large, too little specialized companies exist.

2- HVAC components manufacturers design consultant - this is god-given job for moonlighting, if you can find it (normally such employers want people with proven engineering background in this field), you practically act as design subcontractor to main designer preparing documentation and technical solutions related to your client's equipment. Don't  confuse this job with sales engineer role. Sales engineer establishes and maintains relationships with customers and gives them certain technical support. Design consulatant normally supports larger projects and offers full extent of technical expertise.

This two activites seem lucrative to me as an addition to normal PE Engineer duties and good backup possibility in a phase of starting HVAC firm.

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